Miscellaneous. 



162 



[August, 1909. 



tion of the operations of the societies 

 were recognised in Germany at a very 

 early stage in the existence of the 

 Raiffeisen banks, and the need was felt 

 for a central institution which could 

 borrow money on the collective respon- 

 sibility of a number of societies, and also 

 utilize any available balance in the 

 hands of one society for the benefit of 

 another. Provincial central banks were 

 therefore formed, and these were again, 

 in some eases, centralized in a still larger 

 institution. At the present time the 

 principle of a central bank may be said 

 to be recognised in all the continental 

 countries where co-operative credit has 

 been at all developed, though there is 

 some difference of opinion as to the 

 methods on which it should be managed. 

 In England an institution of this kind, 

 known as " The Central Co-operative 

 Agricultural Bank, Limited," has been 

 registered under the Industrial and Pro- 

 vident Societies Act, 1893, for the pur- 

 pose of financing the village co-opera- 

 tive credit societies affiliated to the 

 Agricultural Organisation Society. 



It is hoped that this bank will also 

 enable the societies to overcome certain 

 difficulties which have been experienced 

 in dealing with their deposits. These 

 deposits ought to form the principal 

 from which their working capital is 

 obtained, but it is pointed out in the 

 report of the Agricultural Organisa- 

 tion Society for 1906 that if a large 

 deposit is offered, the society may not 

 be able at the moment to lend it out, 

 and its only course is to pay it into its 

 own account at the local joint stock 

 bank, where, if it is earning interest at 

 all, it is not earning as high a percent- 

 age as the society is obliged to pay for 

 it, and the society accordingly loses. 

 Again, if the deposit is withdrawable 

 at short notice, the society cannot with- 

 out risk of being placed in a difficulty lend 

 out the money for long periods. The new- 

 ly-established bank will place the socie- 

 ties in a better position in this respect, 

 as it will be prepared both to receive sur- 

 plus deposits from local societies and to 

 advance money to them when required. 



Methods of forming a Society.— An 

 agricultural credit bank of this type 

 may be registered as a " specially autho- 

 rised society" under the Friendly 

 Societies' Act, 1896, on application to 

 the Registrar of Friendly Societies, 

 28, Abingdon Street, SW. This appli- 

 cation must be made on a special form 

 to be obtained from the Registrar, and 

 must be accompanied by two printed 

 copies of the proposed rules, No fee is 

 payable for the registration of an agri- 

 cultural credit society. The rules must 

 comply with the Act, and it may be 

 noted that the Act provides that the 



loans must be confined to members ; that 

 the rules must fix a maximum for any 

 loan made to a member on personal 

 security, and that no loan can be made 

 which, together with moneys owing for 

 the time being by the member to the 

 society, exceeds £50; that the total 

 amount held at any one time on deposit 

 cannot exceed two-thirds of the total 

 sums for the time being owing to the 

 society by the borrowing members ; and 

 that no member can hold an interest 

 in the funds exceeding £200. Where, 

 however, such a " specially authorised 

 society " divides no profit among its 

 members and watches over the applica- 

 tion of the money lent, it is entitled 

 under the Societies' Borrowing Powers 

 Act, 1998, to mate a rule authorising it to 

 borrow money from any person whether 

 a member or not ; otherwise the 

 Friendly Societies' Act requires the " loan 

 fund" to be formed by contributions 

 or deposits from members only, subject 

 to the limitations mentioned above. 



A form of rides has been prepared 

 by the Registrar of Friendly Societies 

 for the purpose of asssisting specially 

 authorised societies in complying with 

 the provisions of the Frendly Societies 

 Act so far as they relate to such 

 societies. A set of model rules specially 

 adapted to agricultural credit societies 

 is also issued by the Agricultural Organ- 

 isation Society, Dacre House, Dacre 

 Street, Westminister, S.W., and this 

 society will assist in the formation of 

 these agricultural credit banks. 



These rules prescribe the terms of 

 membership and provide for the appoint- 

 ment of the committee, trustees, 

 treasurer and secretary, for the holding 

 of meetings, the keeping and auditing 

 of the accounts and other matters. 



The rate of interest on loans and the 

 date of repayment are not fixed by 

 law, but the model rules of the Agricul- 

 tural Organisation Society provide that 

 when a loan is granted it may be for 

 some fixed term not exceeding twelve 

 months, or it may be repayable in 

 instalments at intervals of one, two, 

 four, six or eight weeks, or three 

 months ; the interest to be charged for 

 loans not made repayable by instalments 

 is not to exceed 6 per cent, per annum ; 

 the interest on deposits is not to exceed 

 4 per cent, per annum ; no profit, bonus 

 or dividend of any kind is to be divided 

 among the members, and any surplus 

 after payment of the cost of administra- 

 tion is to be carried to the reserve fund. 



While loan societies, registered as 

 specially authorised societies, cannot 

 claim exemption from stamp duty, 

 priority of claim against the estates of 

 their officers in event of death or bank- 

 ruptcy, agricultural credit societies have 



